Bond dealers and economists give thumbs down to 'inflationary' Budget

Bond dealers are reckoning on at least one rate hike in the second half of the next financial year

Bond dealers and economists have interpreted the Budget this year as inflationary, describing the government’s numbers are aggressive.

Also, there is a high chance that the markets are staring at another year of fiscal slippage.

This will have a direct impact on the Reserve Bank of India’s (RBI’s) monetary policy and it will likely have to abandon its cautious, “neutral” stance in favour of a hawkish tone, economists say. And there may be a sooner than expected rate hike. Starting February 7 monetary policy, the tone of the policy could start turning hawkish.

“This Budget seems to be inflationary. All